Business
Cost Index

One of the country’s biggest and most populated states is also the cheapest when it comes to business costs, with the Lone Star State of Texas scoring 8.43 out of 10.

As well as having some of the lowest prices when it comes to electricity (8.52 cents per kWh) and employee salaries ($39,640 a year), Texas also had a fairly low average cost per Mbit when it comes to internet connections, although it should be noted that we excluded corporate tax rates from the ranking for Texas, as the state has a ‘franchise tax’ instead, which isn’t directly comparable.

Texas’s neighboring state of Oklahoma came in second, with average employee wages coming in at just over $37,000 a year and businesses spending just 7.96 cents per kWh of electricity.

Many businesses in Oklahoma are in the fields of aviation, energy, telecommunications and biotechnology, with the majority being based in the major commercial centers of Oklahoma City and Tulsa.

As by far the most populated state in the country and one of the most important to the economy too, it should perhaps be no surprise to see that California is also the most expensive when it comes to business costs.

Despite actually being among the cheaper states when it comes to internet costs ($1.86), California was noticeably the most expensive state when it came to energy bills, with a cost of 17.74 cents per kWh of electricity, which is over two and a half times higher than in the cheapest state (Nevada).

New Jersey takes second place when it comes to the states with the highest business costs, mainly due to the fact that the state has the highest rate when it comes to corporate tax, with those in the top bracket in the state paying 11.5%.

That’s the highest possible rate in the country and was planned to be reduced, although the decision was taken to restore the 11.5% rate until 2023.

One of the country’s smallest and least populated states was also among the most expensive to run a business in, with Vermont taking third place.

The state was particularly expensive when it came to the cost of electricity (16.67 cents per kWh) and the corporate tax rate, which is currently 8.5% for those in the top earnings bracket.

We also wanted to see how these business costs look around the rest of the world, looking at over 30 major economies, with Hungary coming out as the cheapest place to run a business.

Not only did Hungary have the lowest maximum corporate tax rate, at 9%, it was also among the cheapest when it came to the cost of getting set up with an internet connection, at just $15.23 per month.

In second place is Lithuania, which was the nation with the lowest average internet costs, where businesses only have to pay an average of $12.73 a month to get connected.

It was also among the cheapest nations when it comes to the cost of electricity, with an average unit cost of 11.6 cents per kWh.

The Czech Republic was another very affordable country across the board, coming in as the third-most affordable overall.

The country has been described as "one of Europe's most flourishing economies" and scored particularly highly for the affordability of its internet costs, at $20.55 per month.

Germany ranks as the most expensive country when it comes to business costs, and is the largest economy in Europe.

German businesses particularly face high costs when it comes to utilities, with electricity costing almost 23 cents per kWh, and also have one of the higher corporate tax rates, at 30%.

Another country that faces high costs is Australia, but it also has one of the highest corporate tax rates, with businesses at the very top end having to pay a rate of 30%.

Earnings in Australia are amongst the highest in the world, so prices are naturally higher here. For example, the average monthly internet cost is $56.49, which is over four times higher than in the likes of Lithuania and Poland.

Denmark was the country with the highest average electricity cost for businesses, at 23.2 cents per kWh, which was a big reason why it ranked as the third-most-expensive country overall.

The Nordic country also had some of the highest wages, with an average of $58,430 per year.